Elias: State money switcheroo rouses voter suspicion

One reason Gov. Jerry Brown's Proposition 30 tax increases passed so handily last fall was that many voters became convinced that if they didn't say yes to the new levies, the sky would fall.

Schools would suffer, services for the elderly — already devastated by previous budget cuts — might disappear. Police and fire personnel levels could be decimated. And much more.

Those fears were enough to overcome the revelation of only a few months earlier that the state Parks and Recreation Department secretly squirreled away more than $53 million over 12 years by underreporting the amounts it held in special funds.

Private donors who put up millions of dollars to stave off budget-crunch closings of many park units were infuriated; some demanded their money back but didn't get it.

Brown's office investigated and heads rolled. The state parks director was forced out, along with her second in command.

But one finding of the investigation was that the Parks and Recreation malfeasance was an isolated case, even though department managers often hustle to spend every available dollar before the end of a budget cycle so those funds don't automatically revert to the state's general fund, the fate of unspent dollars not sitting in special funds like the parks department's Off Highway Vehicle Trust Fund, where $33.5 million was stashed.

But a series of revelations since then give cause to question the notion that the parks department was all that unique.

One example: Since 2005, the state Department of Forestry and Fire Protection maintained a separate account containing $3.66 million with the California District Attorneys Assn., paying the prosecutors' group more than $370,000 in management fees.

Some of the money was used to buy GPS monitors, printers and cameras, but the fund also paid for gatherings of fire folk around the state, including $33,000 for one conference in Pismo Beach.

It's unclear why that money was hidden, but this question didn't much interest Brown, who called the whole story "relatively boring, to tell you the truth."

Then there was the sadly underreported misuse of school lunch money, with more than $165 million meant for free or reduced-price student meals going for other purposes over the last few years. Meal money was not stolen, but spent on other school needs like sprinkler systems and salaries of employees of one district's television station.

No one knows how widespread the misappropriations have been, but the state has already gotten refunds from school districts in Los Angeles, San Francisco, San Diego and Santa Ana, among others.

Those bait-and-switch style operations deprived many poor kids of nutrition they needed to learn effectively.

It would be surprising if, taken together, all these incidents didn't cause voters to wonder where else money is being hidden or misspent.

And there's at least one more possible switcheroo in the works. This one involves the more than $1 billion a year from last fall's Proposition 39, which closed some three-year-old corporate tax loopholes.

The measure promised that money would go to "energy efficiency projects at schools and other public buildings all projects shall be selected based on in-state job creation and energy benefits "

But just two months after 39 passed, Brown allocated all its money for energy projects at public schools and community colleges, the funds to passed out on a per-student basis.

Brown gave no reason for leaving out all other public buildings and in a post-budget presentation news conference, Michael Cohen, chief deputy director of the state Department of Finance, said the per-student allocation was because "The data is not going to be there to weigh everything you want to weigh correctly."

So job creation would not be a criterion for this spending, as promised. Neither would maximum energy efficiency. At least on this one, there's a credible solution in the works: a bill by Democratic state Sen. Kevin De Leon of Los Angeles to give all the money to K-12 schools, but specify the kinds of energy retrofits and let the state's Office of Public School Construction — not local districts — manage the program.

Besides that, Brown now proposes at least some reporting requirements for schools that will benefit from the extra money his budget would give schools with high percentages of English learner students.

He's asking that each school district create a yearly "local control and accountability plan" for the extra dollars.

He would have the state Board of Education create new spending guidelines and require each plan be approved by the local county schools superintendent. School officials would also have to consult with parents, teachers and others in making their plans.

Only time will tell if those requirements are enough to prevent part of the new English-learner money from being switched, as some lunch money was.

But at least they figure to be a start toward the kind of transparency the fund-hiding and money-shuffling revelations of the last year demonstrate is a crying need.

Thomas Elias of Santa Monica is an author and columnist. Email him at tdelias@aol.com.